>>Richard Ruelas:
Tonight on "Horizon," Arizona now has the strictest employer sanctions in the country on knowingly hiring illegal aliens. Hear why the governor signed the bill. The governor also signed the Clean Air Bill, and she put her signature on a bill to ban cities from giving tax incentives to lure businesses. We'll talk to the governor about those and more topics next on "Horizon."

>>Good evening, welcome to "Horizon." Arizona now has the toughest law in the land when it comes to dealing with employers who knowingly hire illegal aliens. The bill drew criticism and was also praised. I'll talk to Governor Janet Napolitano about that bill and many other issues she dealt with, but first here are some remarks made from both sides about the Employer Sanctions Bill.

>>Russell Pearce:
I am so pleased with the Governor signing this bill today. As you know, I've worked on this for several years. It is indeed the fair and legal employment act. It's probably the toughest but yet fairest employer sanctions law in the nation. We intend to be tough but fair. Again, we know the lure of those coming across the borders. And again, I know the governor has vetoed many, many bills, and I was concerned about this, and I am grateful that she has joined us. I am so grateful this governor has joined us on recognizing that we no longer can point fingers. It is Arizona's responsibility as well as the federal government to protect our citizens and to protect honest employers and that's what we intend to do. This bill will go a long way in doing that, and I'm hoping that, again, we'll see the fruits of it very quickly.

>>Mary Rose Wilcox:
The governor called immediately after she signed the bill, I spoke with her. And we are extremely disappointed. This is a very sad day for Arizona, and it's one of economic loss for Arizona. The economic sanctions that will go into place will be horrendous for our economy in the state. We've all seen Arizona grow, we've all seen our economy be very vital and this could destroy that. We are here today as a group to put forward a couple of messages. One, we join the governor in her letter. The governor in her letter clearly states the flaws with this bill. Steve has outlined some of them. And we also join her in calling the legislature back to session. This is a call to action for businesses in our community along with working people. They might not have been here when this bill was going through. Many people feel that the business community should have been stronger, more active, they should have expressed their disenchantment with this bill. That wasn't done, but it is not too late. This bill will not go into effect until January 1. We have five months for the business community to rally, come to the table and demand that the legislature, both the Senate and the House, come back and work on this bill.

>>Richard Ruelas:
Here now to talk about the Employer Sanctions Bill and many, many other topics is Arizona Governor Janet Napolitano. Thanks for joining us.

>>Governor Napolitano:
Thank you.

>>Richard Ruelas:
Although many, many might be stretching it with the Employer Sanctions Bill. I don't know how many others we'll get to.

>> Governor Napolitano:
It's been a busy couple of weeks in the governor's office, no doubt.

>>Richard Ruelas:
How was your Fourth of July, by the way?

>> Governor Napolitano:
It was busy. I was in Flagstaff for the parade, went to the Veterans' Home and then was in Peoria last evening. So it was a good Fourth of July.

>>Richard Ruelas:
I'm told you played a little bit of poker at the Veterans Home.

>> Governor Napolitano:
Yeah, we played Texas Hold ‘Em.

>>Richard Ruelas:
Did they clean your clock?

>> Governor Napolitano:
They took my money. That's fair.

>>Richard Ruelas:
Although you don't play for money, at least at first.

>> Governor Napolitano:
Theoretically.

>>Richard Ruelas:
Let's get down to the issue of the employer sanctions. Obviously there seems to be two camps of people who are very upset about you signing this bill, one being the businesses. How do you think it's going to affect businesses in Arizona who call this, I believe, a catastrophe?

>> Governor Napolitano:
Well, I think they, some of these business the sky is falling arguments I find unpersuasive. They're saying our economy is going to fail unless we can hire illegal and underpaid labor. I don't think that's so. I think we have to monitor very carefully what's going on. I think the bill, as I said, has some issues that need to be addressed in special session before it takes effect. But I found it remarkable, some of the arguments being made by the business community. We ought to be talking about how we grow the Arizona economy using legal labor.

>>Richard Ruelas:
There's been a lot of concern about the database, using basic pilot, and there's varying reports about how reliable that database is. What is your read on that data?

>> Governor Napolitano:
There are mistakes within that database. I've already been in written contact with the leadership of the Senate and the Congress back in Washington, D.C., that say you've got to put some resources into this. Other states are going to follow Arizona's lead. So that program will need to be updated and kept up-to-date. But again, there are implementation issues now that will have to be addressed. But what the bill does is say, look, first time, if you are knowingly and intentionally hiring illegals, and there's, that's an intent requirement. It's not a mistake. It's not a mistake, which is what some of these guys think, ‘oh, we make a mistake, you'll put us out of business.' That's not what it is. If you're knowingly and intentionally hiring from illegal end grant labor, the first time you get your license suspended for 10 days or pay a fine. The second time, you lose your privilege to do business within the state of Arizona. It's a tough sanction, but I have felt for quite a while and have said publicly for quite a while that, in the absence of comprehensive immigration reform from the Congress, which would have been the ideal situation, and indeed I was back in D.C. just two weeks ago advocating for that. In the absence of Congress moving, we had to deal with the demand side of the illegal immigration market as well as the supply side.

>>Richard Ruelas:
The Latino community has sort of joined with business in criticizing your action. How do you see this affecting I guess, do you think it could be discriminatory, that Latinos could have a tough time finding work, legal Latinos.

>> Governor Napolitano:
I said number one thing is that we need to make sure it's enforced in a
non-discriminatory matter. This law does not overwrite our laws against discrimination, and that's something -- I was with the attorney general yesterday, and he and I spoke specifically about making sure that those rights of people here lawfully in Arizona are protected. But, again, there's people all over the map on this, so the question is -- you know -- what does the governor do? I thought about it deeply. I looked at the paralysis in Washington, D.C., really thought about the economics of labor movement and Arizona's a growing state. Really have felt for some time that some of this illegal immigrant trafficking is driven by some employers, by no means all, but a few intentionally going into illegal markets and then paying sub-standard wages. And it seemed to me that we needed some tools to deal with that.

>>Richard Ruelas:
Do you think some of those laborers, those workers, will start going to Colorado and California, we might have a temporary shortage here in Arizona?

>> Governor Napolitano:
That's one of the arguments that's being made. I didn't see people flooding the state obviously. Obviously these are things we need to watch.

>> Governor Napolitano:
Unless they all have cabins in Flagstaff.

>> Governor Napolitano:
Exactly. But again, I think in the failure of Washington, D.C., to act, which would have been the ideal situation, one national immigration policy, other states are going to take Arizona's lead on this as well. So at a certain point, we all have an interest in enforcing our nation's immigration laws in a tough and fair way and a reasonable way. I thought, in contrast to the Employer Sanctions bill I was sent last year, which wasn't a sanction at all, I actually thought on this one, while there were some drafting errors and some other issues with the bill, the underlying balance that was struck was not inappropriate.

>>Richard Ruelas:
Some other concerns you want to address in a special session.

>> Governor Napolitano:
Mm-hmm. 7

>>Richard Ruelas:
And I guess the speaker has said he's willing to have a special session if everything can be scripted out in advance. Of the concerns you raised, are there any that you think are barriers that aren't going to result in a special session happening or that aren't going to be able to be fixed?

>> Governor Napolitano:
It's too soon to tell. I raised some things like, you know, want to make sure that critical infrastructure is not unduly affected, that we still have a sanction there but perhaps shutting down a nursing home isn't the right thing. There's some other issues with the bill. I want to make sure there's an express non-discrimination provision in it. So there are some things there that need to be done. I think what will happen is that, as the summer comes to a close and people have a chance to let things sift out a little bit and see what's going on, I will get together with legislative leadership, and we'll talk about some possible changes to the bill. And, yes, ideally, in a special session, you want to have things done ahead of time so the members only have to come back for a day or two and they can then go home.

>>Richard Ruelas:
But you haven't had the conversation with the speaker and president yet?

>> Governor Napolitano:
Other than to tell them I was going to sign the bill, but that I was going to really lay open the possibility of a special session, I haven't had a follow-up conversation with them.

>>Richard Ruelas:
Was part of the political calculus in figuring out whether to sign this was the fact that there was an initiative floating out there that there would be a stricter, harsher version of this or tougher to change if passed by voters?

>> Governor Napolitano:
Well, the initiative is still out there, but I think the incentive for the initiative is a lot less because we're moving statutorily. I even have, and I'll quote a letter from Russell Pearce saying, we understand that, because sanctions are new and new for states to do in this fashion, proceeding by statute is preferable probably to an initiative because a statute you can change, an initiative is cast in concrete. So yes, certainly I did have that in mind that Congress has effectively now punted this issue to the states. Arizona is probably going to take the lead among the states.

>>Richard Ruelas:
The implementation of this, how do you see it rolling out? Will the attorney general make rules that are then followed by prosecutors? Will each county have its own rules? How would you like to see it implemented?

>> Governor Napolitano:
I would ideally like to see one consistent policy statewide. I think that Arizona businesses are entitled to that. I spoke again, like I said yesterday, with the attorney general. I'd also like to get together with the head of I.C.E., the Federal immigration authority here in Arizona, because we could obviously do some cross-referrals.

>>Richard Ruelas:
The Maricopa County Attorney's office has been given the bulk of the money so far towards investigations and enforcement. Do you see a scenario in which Maricopa County has one set of rules prosecutorialy different from other cities or the state?

>> Governor Napolitano:
Let's take it one step at a time. We now have the bill. First thing to address is the special session. The business community obviously wants another chance to come in and make some arguments for some changes, and I'm willing to entertain those, but they cannot undercut the underlying philosophy of this, that we are going to attack the demand side for illegal immigrant labor, recognizing all the impact that may have, but thinking that it's time that our immigration policy dealt with the demand side as well as the supply side.

>>Richard Ruelas:
How has voter or public reaction been either in person or what the governor's office is receiving?

>> Governor Napolitano:
Our calls have been about 85-15 in favor of signing. And that's pretty consistent with the polling ahead of time. I don't make decisions according to polls. I have vetoed other measures that I thought were not wise or doable immigration policy on behalf of the state, not going with the polls. To me, it was a matter of thinking through this issue. It's complicated. Having spent a lot of time in Washington or with Washington the last few weeks trying to get a comprehensive federal bill through, Congress cannot be criticized enough. This is really kind of an outrageous failure on their behalf in the Senate to get to a vote, to get to a package that could move forward. You know. And so they really have punted to the states, and we had to move forward.

>>Richard Ruelas:
What do you see as far as Congress? What do you think, obviously you'd like to see them get back in it have a bill by summer's end. What do you think realistically the chances are of Congress doing something?

>>Governor Napolitano:
I don't think they'll do much. They maybe will give us some border security money, which I will gladly take. There's been some talk of the Dream Act portion, which is for youngsters who've been brought over, basically grown up in our schools, to be able to go to universities and pay in-state tuitions, things of that sort, some little pieces. But the comprehensive reform that really this country demands probably now has to wait until after the presidential election.

>>Richard Ruelas:
When you spoke at the National Press Club, you said you refuse to concede that illegal immigration is a political winner. Politically, nationally, it does seem that there's a lot of candidates, legislatively, for Congress, running for president, Tom Tancredo, who do use this issue to hammer the fact that we just need to build a wall and seal it up.

>> Governor Napolitano:
Yeah. And Tom Tancredo is hovering around 1 percent in the polls, so he's not going to be that major. There's always going to be that fringe group, but they're not going to be the ones that ultimately decide on any comprehensive federal bill. Why? Because they don't want to talk about anything other than a wall. Anyone who's actually been to our border and understands the border security issues that we have, who understands the labor economics involved, know that the simplicity of a wall is simply a bumper sticker, it's not an answer. Until we deal with the 12 million already in this country illegally, we actually have silent amnesty, and so again Arizona now is taking a step forward. It's an experiment. There are some chances involved with it. But Congress really left us no choice.

>>Richard Ruelas:
Yeah. Maybe because, here in Arizona, we've been discussing immigration for so many years, we have a slightly, we're ahead of the learning curve a little bit.

>> Governor Napolitano:
I think Arizonans are. This was a big issue in last year's races, my last race as Governor and certainly our Congressional races, and Arizona voters were pretty clear about throwing out those who simply had a simplistic answer on immigration. They were really listening on immigration.

>>Richard Ruelas:
You signed a bunch of other bills. I guess your desk is pretty clear these days.

>> [laughter]

>>Richard Ruelas:
You signed a bill that reduced the probable cause to give an illegal alien, a suspected illegal alien, charged with a serious felony.

>> Governor Napolitano:
This is the bail issue, and the issue is what is the standard of proof that the prosecutor has to show in terms of whether someone is in the country illegally to get into the non-bailable category? The legislature passed it. The Maricopa County Superior Court, I don't know what they were doing. I don't know what the court system thought they were doing. Talk about not giving clear guidance where guidance was necessary. In any case, the legislature passed a bill saying preponderance of the evidence is burden of proof, which is consistent with federal law. Of course, I'm a former federal U.S. attorney, so when I saw that bill, there was nothing new in that bill to me, so that was an easy signature.

>>Richard Ruelas:
A lot of the lawmakers and some prosecutors have said the superior court system was intentionally trying to subvert the will of the voters. Do you see that?

>> Governor Napolitano:
I'm very respectful of the judicial system overall. On this, I just thought they were just out to lunch. You didn't know who was doing what, who was making decisions. Clarity was necessary and they were all over the map. I did think they were not faithfully trying to adhere to the will of the voters. Nobody was running that ship and it's too bad. Legislature stepped in and I thought really the burden of proof they came up with is consistent with what the federal burden of proof in these situations is. I'd seen that burden of proof before. I had no problems signing that bill.

>>Richard Ruelas:
We're slowly moving off immigration, but as we cling on to the last of it, Judge Collins, Tim Hogan in the English Learner lawsuit is probably going to start asking for sanctions soon. How do you see that playing out? Do you foresee another special session later on?

>> Governor Napolitano:
I would love to get together with legislative leadership and work this out and get it out of court, but I've been trying that for some years. I think there are some members of the legislature who just like the delay. They like to bounce back and forth and the district court and ninth circuit have been taking their own sweet time. You can tell I'm not a real fan of the courts right now, in terms of how they've been running their business, slow, not taking charge, not dealing with important issues put before them in a way that allows us then to follow on whatever decisions are made. It's a frustration, but I think there are some members of the legislature taking advantage of that delay time between the district court and the court of appeals. While I would like to get this out of court and get it resolved, I suspect we'll be looking at more delay.

>>Richard Ruelas:
Do you think the current plan the legislature had on English language learners needs to have an opportunity to be implemented to see if it works?

>> Governor Napolitano:
I think Judge Collins is right in his recent decision in terms of the legal problems with that bill. They were problems that I pointed out when I let it go into law without signature. And nothing has changed in that regard. So, again, he's got to rule, and it'll go up to San Francisco and back, and I will continue to see and explore ways, to see if we can sit down, legislature, please, and see if we can get this out of the court systems.

>>Richard Ruelas:
Six months into your second term, it seems like your relationships with one chamber of the legislature went very smooth this year. The Senate worked with you to pass the budget. What do you attribute that sort of ease to?

>> Governor Napolitano:
Well, I think every year is different in the legislature, and this year we had new members, new leadership in the Senate. It was not an election year. I think that made a difference. I actually think overall relations with the House were better as well. It's just on the budget, the Senate was willing to sit down from the early days of the session and really, you know, work through that very, very complicated document. I mean, you're talking about a $10.6 billion negotiation with hundreds of items in it, and they were willing to sit down early on and work things through, and I thought they were very fair. The House was given the opportunity to participate in that, chose not to. I suspect next year they may want to revisit their strategy.

>>Richard Ruelas:
On taxes, there was a bill that was tried to pass dealing with tax breaks for businesses that want to move into cities. That finally got through. Why did you sign that bill?

>> Governor Napolitano:
What it does is it bars cities in Maricopa and Pinal counties from using tax incentives to attract retail businesses. And what the bill was designed to do was to prevent cities from actually giving tax breaks against each other, kind of getting in bidding wars, when in essence there was no new economic wealth being generated. That's why it was limited to the retail industry. I'm usually in big favor of local control. I like our cities, and overall they do a good job. In this area, they've been for several years, we've been saying, you've got to get control over this, because this is just getting less and less explicable as a matter of economic policy and what you're doing to the taxpayers, and it was just getting more and more out of control. When the bill got to my desk, I said on this one we're going to have to jump in and stop it.

>>Richard Ruelas:
You also signed a Clean Air Bill stopping some leaf blowing by government employees. [laughter]

>> Governor Napolitano:
The bill has so much more in it than that. It's a very major air quality bill. It will remove literally thousands and thousands of pounds of particulate matter from the air that we have on a day like today. It's so obvious why we need that. So the bill was introduced by Senator Carolyn Allen. She worked it. They stripped it first, and then we went back to the table and got a lot of improvements back on it, and overall it's a very, good, strong bill. I'm very pleased with it.

>>Richard Ruelas:
And one that took a while to get through, because a lot of industry didn't want any of these measures to go through.

>> Governor Napolitano:
It's complicated. Everybody came to the table realizing that, if we don't meet clean air standards, we suffer potential federal sanctions. More important, it's a big public health issue for all of us. We all live here. We're raising our families here and what have you. There was a sense that this is something in everybody's interest to take on.

>>Richard Ruelas:
One of the interesting bills you vetoed started out as sort of a benign bill about election law and sometime in April became a bill about letting Congressional vacancies, if a member happens to leave office, let it go for about six months. You thought that let it go too long. Do you think that had anything to do with Rep. Rick Renzi?

>> Governor Napolitano:
[laughs] You think? I think that was possible. And I think it would have given us an unduly long vacancy period. Didn't seem to be in the best interests of the voters, particularly the voters in District 1.

>>Richard Ruelas:
Arizona's early primary, what do you think? Moving up?

>> Governor Napolitano:
I'm thinking about it, and I've not yet made a decision. For those who are watching, the governor sets the date of the primary, and obviously this year is an odd year because so many states have moved up. Some states have actually broken their national party rules to go earlier, and it has really jump-started the whole presidential race. The question is where is the best place for Arizona to be? And I haven't made that final decision yet.

>>Richard Ruelas:
And you've sat in the room with some oil officials and talked to them about gas prices. What can the state do about gas prices? Or have you found any answers in dealing with them?

>> Governor Napolitano:
We're not enacting gas price control, so that's not within the realm of possibility. I met with the Western States Petroleum Association, and they could only answer some questions because they're afraid of anti-trust liability. They were not able to give me a lot of answers to some very pointed questions I have about pricing policies. We're going to set up one-by-one meetings with oil companies, so we can ask questions about their investment strategy, what they are doing to make sure we have a continuous and viable source of gasoline, and then what's their refinery capacity and what are their plans?

>>Richard Ruelas:
It sounds like gentle persuasion rather than implementing some sort of regulatory control.

>> Governor Napolitano:
I'm not sure the western states people thought I was all that gentle when we met with them, but this is again an area of vital interest to Arizona. This is a fundamental commodity we must have, and I'm not satisfied the suppliers of that commodity, the oil companies, are doing everything they ought to do by way of Arizona.

>>Richard Ruelas:
A viewer wanted to know why the All-Star NBA game was given a tax break, I guess especially following the Suns season. How's that different from the bill about the cities.

>> Governor Napolitano:
No. It's a very small sales tax adjustment, and it is commonly done by cities that host the NBA All-star game. So it's an adjustment. We made a similar adjustment before when we had the NBA All-star game. We've done it also for things like the Super Bowl. So we make those adjustments, and actually the evaluation is, in the end, do we make more money by giving a little break or not? In these events, we obviously make more money.

>>Richard Ruelas:
Even after the way the Suns season ended.

>> Governor Napolitano:
Oh that was terrible. Oh, talk about the punishment not fitting the crime. We can revisit that some other day. At some point, I want to meet with the commissioner ono-on-one on that.

>>Richard Ruelas:
Thank you, governor. Appreciate you coming by.

>> Governor Napolitano:
Thank you very much.

>>Announcer:
It was decision time this week for Governor Napolitano, and she decided to sign the Employer Sanctions Bill sent by the legislature. The governor also signed 28 other bills on Monday and vetoed five. We will talk about her decisions on the "Journalists' Roundtable" Friday at 7:00 p.m. on "Horizon."

>>Richard Ruelas:
Thanks for joining us on "Horizon." I'm Richard Ruelas. Good night.

>>Announcer:
If you have comments about "Horizon," please contact us at the addresses listed on your screen. Your name and comments may be used on a future edition of "Horizon."
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